How the U.K.’s homeless are benefiting from contactless payments
The U.K. is firmly embroiled in the seemingly inevitable contactless revolution. Over the past five years, U.K. Finance data shows that the number of monthly contactless transactions has soared to 644 million in February 2019 from 14 million just five years earlier.
Now, even the homeless are getting on board with contactless payments, through a new U.K.-wide initiative between Swedish payments company iZettle and the Big Issue Foundation, which enables homeless people to become street vendors by selling its Big Issue magazines.
“It’s well documented that fewer people carry cash these days, and the aim is to provide access to contactless payments to as many vendors as possible, to help sales and increase their income,” said Edward Hallett, managing director at iZettle U.K. “Research shows there’s been a huge uptake in contactless in the U.K., and this now makes up 80% of iZettle’s total card payments in this country. The ability for vendors to accept contactless as well as cash encourages people who aren’t carrying loose change to make a purchase."
A pilot study which ran from December 2018 to May 2019, involving 21 vendors across seven cities in the U.K., saw sales boosted by an average of 25% by the introduction of contactless payments, with two vendors receiving 80% of their total sales from cashless transactions.
“I’ve definitely noticed a dip in the number of people carrying cash, which has previously had a knock-on effect on the number of magazines that I’m able to sell,” said Christian Easton, who sells the Big Issue at White City, London. “Being able to accept contactless payments as well can only be a good thing, helping me to grow my business.”
Enabling homeless vendors to take contactless payments has also yielded additional social benefits in terms of financial inclusion, with partnerships between iZettle and challenger banks such as Monzo enabling many vendors to get bank accounts as part of the initiative.
“Before all this started I had no ID, no bank account and a rubbish phone — and now I have a decent smartphone, a passport, a Monzo bank account and a card reader,” said Jim Hannah, who sells the Big Issue in Norwich. “I now feel ready for a cashless future.”
Such partnerships have been made more viable over the past year, in the wake of PayPal’s high-profile takeover of iZettle. The Big Issue predicts that such collaborations will make a substantial difference to the lives of many homeless individuals.
“There’s a lot of work being done in this area across the industry and we’re actively working with a number of financial institutions to help develop easier access to basic banking facilities that will help support more Big Issue sellers get a foot firmly back into mainstream society,” said Russell Blackman, managing director of the Big Issue.
For iZettle, this is only the start, with further initiatives in the pipeline to use contactless payment technology to aid various social causes.
“We’re involved in a number of projects using contactless technology to help individuals increase their earnings, and charities and not-for-profit organizations increase their donations,” said Hallett. “For example, we partnered with Busk in London, a Mayor of London-backed initiative, to help street performers accept contactless contributions whilst performing. And we partnered with Children in Need as they collected contactless donations during their Appeal Week for the first time.”